The upside is capped in the 9,980-10,020 range for now. NEW DELHI: The Nifty50 ended up forming a ‘Hanging Man’ pattern on the weekly charts on Friday, suggesting indecisiveness among the market participants. The index traded rangebound through the week, but could not breach the intraday range between the 9,861 and 9,988 levels seen on Monday in last four sessions.

A Hanging Man pattern, which is a bearish formation, is usually formed in an uptrend, which indicates trend reversal. It is characterised by a small real candle with a long shadow.

«Any gap-down opening on Monday could further squeeze the range,» said Mustafa Nadeem, CEO at Epic Research.

Mazhar Mohammad, Chief Strategist for Technical Research & Trading Advisory at Chartviewindia.in, said the Hanging Man pattern was formed after the index retraced 62 per cent of the entire loss from the high of 10,137 level.

This, says Mohammad, suggests that the positive closing in the previous three weeks was not strong enough to register a breakout.

The Nifty50 traded largely in a 50-point range before closing the day at 9,934, up 4.90 points or 0.05 per cent. The index, though, formed a small bearish candle on the daily chart.

“In the absence of a buy signal on the critical momentum oscillators, it will be difficult to anticipate when this market breaks out. We advise traders to remain cautious and initiate longs only when the index firmly trades above the 9,988 level. The upside looks capped at 10,088,” he said.

Nadeem said the immediate support on the weekly chart arrives at 9,850. If it is breached on a closing basis, it could push the index to the 9,750-9,600 range.

“The upside is capped in the 9,980-10,020 range. A lot will depend on participation of sectors, since recent support is held due to buying in heavyweight counters such as metals, banks, auto and infrastructure and buying in consumption stocks in the later part of the week. A bearish move in these sectors will weigh on sentiments in the coming week,” he said.

«Nifty50 formed a small candle and got stuck in the broader trading range of 9,850 to 9,980 zones from last eight trading sessions. Now it has to continue to hold above 9,928 zones to witness an upmove towards 9,980,» said Chandan Taparia of Motilal Oswal Securities.